Wednesday, June 27, 2007

TOP STORY >>Taxing food for tourism weighed

By RICK KRONLeader staff writer

A proposed two-cent tax on prepared foods, also known as a hamburger tax, will give Jacksonville’s military museum a chance to bring in aircraft to display on the museum grounds, help attract a big-name entertainer to the Wing Ding Festival and fire up the fireworks at the annual patriotic spectacular.

Overall, the tax will increase the city’s advertising and promotion commission’s budget from its current $88,000 a year —garnered from a hotel room tax—to around $600,000 a year.

Discussion of the suggested tax is on the Jacksonville city council’s agenda for its meeting at 7 p.m. Thursday at city hall. Alderman Marshall Smith, who chairs the advertising and promotion commission, says a number of aldermen are for the tax, but it will only be discussed at this upcoming meeting. “I don’t see us voting on it yet. Everyone needs to take a good look at it before we put it in an ordinance,” he said.

According to state law, a city can have up to a three-cent tax on prepared foods and up to a three-cent tax on hotel rooms to gain funds for marketing and promotion.

The council can approve up to a two-cent tax in either category without asking for a vote of the residents. A three-cent levy requires a public vote. Currently Jacksonville has a two-cent tax on hotel rooms and no tax on prepared foods. “The tourism study we commissioned last year recommended the tax as a way to raise more money to promote the city. If we don’t do it, we’re not showing much faith in the study,” Smith said.

The commission approved the idea of the tax at its June meeting, along with a recommended budget.

“The council can change or adjust that budget too,” Smith said. Based on figures provided by the state department of finance, the commission believes the two-cent tax will bring in $550,000 the first year. The commission has suggested that it use half the income, or $275,000, for professional promotion and marketing campaigns to bring people to Jacksonville and its attractions.

About 30 percent of the tax, or $163,000, will be given to the city’s parks and recreation department to be used for park improvements and operations.

The commission has slated $20,000 for the patriotic spectacular show to increase promotion of the activity and allow for a bigger fireworks show. The Reed’s Bridge Battlefield group will get $12,000 to buy Civil War displays and make other improvements to the site to bring in tourists.

The Jacksonville Museum of Military History will get $22,000 of the new money to help get the necessary permission to display static aircraft and to help toward the purchase of an aircraft.

The commission will set aside $30,000 of the tax for projects, requests and ideas that come up during the year that are not already budgeted.

Another $18,000 will be used to help pay for the staff to coordinate and collect the tax data, staff training and educate businesses and the public on what types of items are taxable. “For example,” explained Paul Mushrush, the city’s finance director, “if you go into a store or restaurant and fill a to-go box with salad items from the salad bar that is not a prepared food item, but if you add utensils, then it becomes taxable.”